Crew workers split between hourly and piece-rate pay

When properly managed, piece-rate pay can result in enhanced wages for crew
workers and increased productivity for growers. Despite the benefits of piece
rate, crew workers were evenly divided between those who favor hourly pay and
those who prefer piece-rate pay. Crew worker concern about how piece rates are
determined played a key role in the unexpectedly low preference for piece rate.
Suggestions are offered for establishing piece rates as pay incentives.

Piece-rate pay can result in enhanced wages for crew workers and increased
productivity for growers. These gains are not always achieved, however. Many
farm employers are concerned that quality suffers when workers are paid by the
piece. Quality concerns can be overcome, but other challenges remain. Why is
it, for instance, that some workers do not seem motivated by piece-rate work?
What effect does worker attitude have on productivity?

Two separate studies were conducted in an attempt to find both grower and
crew worker feelings about piece rate. In the first study (1992-1993), a survey
instrument was used to collect data from 404 fruit, nut, grape and vegetable
growers. In the second study (1995), 211 crew workers were interviewed in
orchard, vineyard and vegetable operations. Grower feelings are briefly
summarized, but the emphasis of this report is on crew worker responses.

Grower responses

Survey respondents included 160 fruit (and some nut), 157 vineyard and 87
vegetable growers. The grape growers were mostly California farmers; the other
categories included growers from other states.

Sixty percent (n = 220) of the growers had used some sort of incentive pay
and 40% (n = 146) had not. Those who had used incentives ranked the following
as their top 5 (out of 14) concerns when using incentives: (1) poor quality
work, (2) no change in worker performance, (3) difficulty in setting standards,
(4) change in work methods or technology and (5) neglect of important goals not
directly rewarded.

Most incentives (92%, n = 202) were geared to field workers. Sixty percent
of the growers were very pleased with their incentives, 35% were somewhat
pleased and 5% were not pleased. In turn, 61% of grower respondents felt that
their employees were very pleased and 35% thought employees were somewhat
pleased, while 1% thought they were not pleased and 2% were indifferent.

Given 211 crew workers, who represent a combined experience of over 2,000
years of work in agriculture, one is likely to find examples of very positive
employer behavior. One farm labor contractor (FLC) was highly praised by his
crew workers in terms of both treatment and pay. Those who worked for this FLC
rated their jobs high (4.4 average on a scale of 1 to 5, where 5 meant the job
was excellent). One enthusiastic crew worker said, "This contractor is
excellent! He is a five. Write it down!" Another FLC was remembered with
fondness by a crew worker. "I had a good contractor who treated me well
and gave me $200 so I could get legalized." Another crew worker, when
pressed for suggestions on what the grower could do to improve, simply
responded, "Let him keep working as he is." In the same operation,
but a different crew, a worker said, "These are good people," when
asked what growers could do to improve.

Once again, when exploring workers' past and present experience in
agriculture, one is likely to find some problems. While crew workers tend to be
satisfied with their jobs for the most part, pay issues are a frequent source of
trouble. It is hoped that these challenges are not taken out of context.

Twenty percent of the crew workers (n = 41) had experienced only hourly or
only piece rate. Of those, 90% (n = 37) had worked only under hourly pay. A
greater percentage of women, 44%, had never experienced piece rate, in contrast
to 13% of men who had not. Four men had experienced only piece rate (2%), but
none of the women had.

Gender and age affected crew workers' choice of pay method. Eleven women
(65%) chose hourly pay in contrast to only six (35%) who preferred piece rate
pay. Workers who favored hourly pay were also more likely to be 40 years old or
older (67%, n = 37). In contrast, crew workers younger than 40 (63%, n = 49)
tended to like piece rate better.

At the time of the interview, workers who favored hourly pay were more
likely to be paid by the hour (64%, n = 42). Likewise, those who preferred
piece rate were more likely to be paid by the piece (58%, n = 39).

Other interview questions also helped determine the importance of the pay
function, including (1) reasons why workers had quit previous jobs, (2)
suggestions for employers, and most important, (3) worker explanations about why
they chose either hourly or piece-rate pay.

Quitting. Only 22% of the 126 crew workers had ever quit without having
another job in hand. Of these, 36% left for reasons related to the piece rate,
and another 20% mentioned low wages as the reason for quitting.

Suggestions. As part of the interview process, some crew workers were asked
for suggestions they would give to employers in general or to their own
employer. Many had no suggestions, or only positive comments to make about
their present employer. Of 91 respondents who offered some suggestion, half
dealt with pay issues. Of these respondents, 83% (n = 38) mentioned the need
for higher wages in general, while 17% (n = 8) spoke specifically about
piece-rate concerns.

Some crew workers explained that by the time government deductions were
taken from their paychecks, and they paid for room, lodging, and raiteros (slang
for the person who provides a ride to work), there was little money left. One
man in frustration said, "Ya no sirve el Norte." (The North [that is,
north of the Mexican border, the United States] is no good any more.) Another
lamented that conditions had gotten worse over the past 10 years.

Numerical data show that workers are split between a preference for hourly
and piece-rate wages. Crew worker comments explaining their reasons for pay
preferences are illuminating.

Preference for piece-rate pay

The most common reason for preferring piece-rate pay was increased earning
potential. Workers could acquire greater earnings in fewer hours of work, even
though it took more effort to do so. Workers also felt they could work at
their own pace without being pressured. For one crew worker, piece-rate work
was more exciting and less boring.

Crew workers reported that when they are paid by the hour, some supervisors
constantly push for faster work, expecting piece-rate effort for hourly pay.
The word carrilla (slang derived from the Spanish words carrera, race and
correr, run) was often employed to describe this pressure for faster work.
Several workers drew examples from previous jobs: "Some expect that we
don't even talk to other employees [when paid by the hour]," a worker
explained. Another witnessed a young woman who was not permitted to go to the
bathroom even though she was ill. The woman ended up vomiting in the field.
Another worker who requested a break after hours of exertion was refused with
the comment, "Why do you want a break? Chavez is dead."

Preference for hourly pay

Worker preference for hourly pay fell into three general categories, from
most to least frequently mentioned: crew workers (1) felt that piece rate was
unfair, (2) preferred the pace of hourly paid work or (3) associated other
benefits with hourly pay.

Piece rate unfair. A worker's sentiment that employers want "piece-rate
effort for hourly pay" takes on a different twist here. Workers are being
paid on a piece rate, but may earn no more than when paid by the hour. Some
felt that piece rate was a gamble, never knowing how it would pay. One worker
felt that the added effort of piece-rate work should result in at least twice
the hourly wage.

A worker described how on a previous job he had been offered $1 per box of
apricots picked. When he picked 100 boxes for the day the rate was suddenly
changed to 50 cents per box. A common view was, "I would like piece rate,
but only if more effort means more pay. What they have done here is pay us less
per unit of work once they found out we did too much. They forget that we put
much more effort into this work by the piece." Another worker explained, "If
we are making too much on piece rate we are told to also weed and that reduces
our earnings." Sometimes the change is not made during the season. "Four
years ago I could really earn more money by the piece. The next year they
reduced the rates. That is why piece rate is no good."

A crew worker was frustrated with agricultural employers who don't specify,
up front, what the piece rate is. "They wait to see how the day comes out,"
he explained. These employers are thinking in terms of what they want to pay
the average employee on an hourly basis. Workers soon realize that increased
performance translates into lower rates per piece. This worker pleaded, "Tell
them not to do that."

Another crew worker explained that being sent back to redo a job takes on
more serious consequences when the worker is being paid by the piece. Workers
felt that supervisors needed to appraise their task performance in a timely
fashion.

Liked pace of hourly pay. Many of the crew workers who preferred hourly pay
liked the calmer, easier pace of hourly work. One woman felt that piece-rate
pay was more a man's work, but was quick to add that women who wanted to do
piece work should be permitted to do so. Some of the older men said that they
preferred piece rate when they were younger, but would now choose hourly work.
One worker explained with pride, "I used to pick melons [at piece rate] for
14 years, but I don't do it anymore. It's very heavy work and now that I'm
almost 30, I can't do it. I used to want to be the best in the crew and run
around like a horse. It was a competition to see who would make more. Once we
made $1,097 each for the week. By 12 o'clock we would have made $100 each, but
would keep going. On good days, one could pick $10 in 20 minutes."

A few crew workers felt that they were not fast enough to do piece-rate
work. One employee attributed his preference for hourly pay to a bad back. A
couple of workers mentioned getting breaks as a benefit of hourly work.

Hourly pay associated with other benefits. For a third, even smaller group
of employees, hourly pay was associated with other benefits, such as a longer
work season and more hours of work available, higher pay, a steady check rather
than one paid at the end of the season and health insurance coverage. Further,
some employees associated hourly work with growers and piece-rate pay with FLCs.

Conclusions

Crew workers in this study were evenly split between those who preferred
hourly pay and those who preferred piece-rate pay, the most common incentive
used with crew workers. This result seems at odds with a grower feeling that
workers generally seem pleased with incentives. But it certainly helps explain
why, after poor-quality work, the next two top concerns of growers who try to
motivate employees through incentives are (1) seeing no change in worker
performance and (2) difficulty in setting standards. These factors are closely
related. Workers are hesitant to give their all when they fear that piece rates
are not firm. "If I knew what I was being paid by the tree thinned, I
would have already finished this row," a crew worker explained in an
earlier study (California Agriculture, Jan-Feb 1995).

Farm employers have a challenge in setting fair rates when crop conditions
are so variable from year to year. Employers who fail to do their homework in
setting piece rates sometimes ask workers to go ahead and work for a piece rate
that will be announced later, or have workers perform by the hour for a couple
of days and then set the piece rate. In either case, workers soon learn that
the faster they perform during these initial periods, the lower the pay for work
performed.

At times, employers make a mistake in setting pay standards and end up
paying more than they think they should. Some have reduced the piece rates at
this point. In doing so they lose employees' trust and make workers hold back,
fearful that superior performance will bring down their wages-if not
immediately, maybe next season. Other employees set piece rates that are too
low to begin with, so crew workers don't think the work is worth their effort.

The main reason workers prefer piece-rate pay is a desire to get the work
done quicker and earn more. A secondary reason is to escape the nagging or
carrilla that sometimes accompanies hourly work. Another negative practice of
one grower was using "rabbits"--that is, paying a couple of workers
under the table to work faster in an effort to get more out of an hourly crew
without having to pay more.

The two main reasons that workers prefer hourly pay are to avoid the games
associated with piece-rate pay and a preference for the slower-paced hourly
working conditions. Laboring by the hour can be substantially calmer, and
offers breaks. Although in theory piece-rate workers can take a break whenever
they want, in practice workers often forgo their break because they are not
compensated for break time. A third reason for preferring hourly pay is to
obtain other benefits associated with hourly pay.

Worker differences accounted for some variance over a desire for piece rate
versus hourly pay among crews. For instance, both gender and age had some
effect on worker desire to work by the piece or by the hour. However, it is
important not to generalize about either gender or age in terms of individual
employee abilities. For instance, in an earlier study of vineyard pruners
(California Agriculture, March-April 1988) a woman allowed her husband to
surpass her in a pruning test, even though daily work records showed she was
consistently the fastest pruner on the crew.

Recommendations

Here are a few recommendations to farm employers who would like to
consistently achieve higher worker motivation under piece-rate pay:

Think more in terms of how much it should cost to do a job, rather than how
much to pay a worker per hour. In a properly constructed incentive pay system,
the more the worker earns, the better off the employer is.

Set standards carefully and inform workers ahead of time of the piece rate.
Fair piece-rate formulas can be developed taking into consideration crop
density and (where records exist) labor costs.

Once a pay level is set, it should not be reduced.

Provide training and performance appraisal early on when workers change
from one task to another. Even better, crew workers should earn the right to
work on piece rate when they have proven their full understanding of expected
quality, and not before.